Marketing to Millennials

millennials2 I know next to nothing about marketing but one thing seems kind of obvious—if you want to sell to young people don’t offer them stuff their parents loved. Millennials are probably not listening to Careless Whisper by George Michael or Whitney Houston’s I Will Always Love You.

And they probably don’t want to drink over-ripe, over-oaked Cabernet Sauvignon while standing at a tasting bar at a faux Italian-style villa noshing on prosciutto and goat cheese while listening to Mozart and nodding with a vacant grin at the server spouting memorized tasting notes. Not that there is anything wrong with any of that. It’s just something people did 30 years ago and, to today’s emerging wine drinkers, it probably seems like there ought to be something else to do at a winery.

So David Ferry’s article in the San Francisco Chronicle entitled “Why Wine Country Isn’t Attracting Millennials” is timely given the recent struggles to maintain growth in the wine industry.

Today, Millennials make up just 17% of the fine wine market, according to the Silicon Valley Bank’s influential annual wine industry report, and that number has stubbornly refused to budge for years. Tasting room visits in Napa have trended down for the last five years, even as regional tourism has boomed, and the average price for a tasting has skyrocketed to $40 per person.

There are of course the widely discussed economic set backs afflicting millennials and the increased competition from beer, cocktails, spirits, legal pot, etc. Wine used to be the only interesting alcoholic beverage around. That is no longer the case. But Ferry digs a bit deeper arguing that it’s the experience that counts. To compete, wineries will have to offer something that doesn’t feel like a Frazier re-run.

As an example of a new vibe trying to gain traction in Napa we get this:

…the Prisoner Wine Co.’s new tasting room, in St. Helena, veers toward what you could call hipster Game of Thrones. Chains hang from the ceiling; the furniture is gunmetal and leather; a vibrating skeleton serves as art.

Edgy and very pricey. Is this the answer? Probably not. It sounds about as authentic as faux Italian-style villas.

In fact the rest of the article is about new varietals, new wine regions, new approaches to winemaking, and giving people a product they may not have experienced before. At the end of the day it is wine quality that matters but, with apologies to Shakespeare, “there are more things in heaven and earth than are dreamt of” in the wine palaces of Napa Valley.

In fact, Napa may be losing its cachet as the wine destination in the U.S.

But Millennials are a worldly generation, just as interested in exploring the offerings of Greece or Argentina, says Amber Lebeau, an industry vet and (Millennial) wine blogger. Her peers are happy to travel to Washington or Oregon or Texas for a wine country weekend. “Napa doesn’t have the monopoly anymore,” she says.

I’ve visited most of the wine regions in the U.S. and Amber and her peers are right. Napa makes extraordinary wines but the experiences to be had in emerging wine regions feel more authentic and more exciting.

This is a real dilemma for established wine regions. The wine business is not built for rapid change in responding to market conditions. It takes a long time to grow and nurture grape vines and the sunk costs are enormous when land costs $400,000 per acre.

Few growers are willing to pull out their ever-popular Chardonnay or top-dollar Cabernet Sauvignon just because Millennials are interested in offbeat varietals, McMillan says.

Perhaps the best thing for Napa to do is wait until tastes change and skin-contact whites and pet nat are seen as just so much old news. As surely as death and taxes, that day will come.

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